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Introduced Version Senate Bill 280 History

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sb280 intr
Senate Bill No. 280

(By Senators Green, White and Chafin)

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[Introduced February 17, 2009; referred to the Committee on the Judiciary; then to the Committee on Finance.]

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A BILL to repeal §28-5B-1 of the Code of West Virginia, 1931, as amended; and to amend said code by adding thereto a new article, designated §25-7-1, §25-7-2, §25-7-3, §25-7-4, §25-7-5, §25-7-6, §25-7-7, §25-7-8, §25-7-9, §25-7-10, §25-7-11, §25-7-12, §25-7-13, §25-7-14, §25-7-15, §25-7-16, §25-7-17, §25-7-18 and §25-7-19, all relating to enacting the Correctional Industries Act of 2009; modernizing the provisions of the Prison-Made Goods Act of 1939; authorizing the creation of prison industries enhancement programs provided by Title 18 U. S. C. 1761(c); and updating certain terms.

Be it enacted by the Legislature of West Virginia:
That §28-5B-1 of the Code of West Virginia, 1931, as amended, be repealed; and that said code be amended by adding thereto a new article, designated §25-7-1, §25-7-2, §25-7-3, §25-7-4, §25-7-5, §25-7-6, §25-7-7, §25-7-8, §25-7-9, §25-7-10, §25-7-11, §25-7-12, §25-7-13, §25-7-14, §25-7-15, §25-7-16, §25-7-17, §25-7-18 and §25-7-19, all to read as follows:
ARTICLE 7. CORRECTIONAL INDUSTRIES ACT OF 2009.
§25-7-1. Intent of article.

Whereas, the means now provided for the employment of inmate labor are inadequate to furnish a sufficient number of inmates with employment, it is hereby declared to be the intent of this article:
(a) To further provide more adequate, regular and suitable employment for the inmates of this state, consistent with proper correctional purposes;
(b) To further utilize the labor of inmates for self-maintenance and for reimbursing this state for expenses incurred by reason of their crimes and imprisonment;
(c) To effect the requisitioning and disbursement of prison-made products directly through established state authorities with no possibility of private profits therefrom, except for those specific articles or products manufactured and sold pursuant to the requirements of Title 18 U.S.C. 1761(c), the Prison Industries Enhancement (PIE) Certification Program and pursuant to sections eighteen and nineteen of this article.
(d) To provide for Correctional Industries to be a profitable entity since it is a self-sufficient authority.
§25-7-2. Citation of article.
This article may be cited as the "Correctional Industries Act of 2009."
§25-7-3. Establishment of industries at correctional facilities; purposes and extent.
The State Commissioner of Corrections or his or her designee has exclusive authority to execute any contracts that are necessary to effectuate the provisions of this article, and is further authorized to purchase equipment, raw materials and supplies and to engage the supervisory personnel necessary to establish and maintain for this state at any correctional facility or institution now or hereafter under control of the commissioner, industries for the utilization of services of inmates in the manufacture or production of such articles or products as may be needed for the construction, operation, maintenance or use of any office, department, institution or agency supported, in whole or in part, by this state and the political subdivisions thereof: Provided, That the provisions of article three, chapter five-a of this code, relating to the Division of Purchasing of the Department of Finance and Administration shall not apply to any contracts or purchasing of equipment, raw materials and supplies as set forth in the West Virginia Purchasing Division's Procedures Handbook.
§25-7-4. Prison industry service contracts.
The Commissioner of the Division of Corrections may enter into contracts with private sector entities that would allow for inmate labor to be provided for prison industry service work and work that involves exportation of products. The use of such inmate labor may not result in the displacement of employed workers within the local region in which work is being performed. Service work is defined as any work such as repairs, replacement of original manufactured items, packaging, sorting, recycling, labeling or similar work that is not original equipment manufacturing. The division may negotiate the wage to be paid for inmate labor provided under prison industry service work contracts, and such wages may be less than the prevailing wage for work of a similar nature in the private sector.
The Division of Corrections, in conjunction with the Department of Commerce, shall develop and maintain a marketing plan to attract private sector businesses for the employment of inmates through the prison industries program. The marketing plan shall include, but not be limited to, provisions of public advertising to establish a prison based industry and a certification by the Department of Commerce that each new contract does not create an unfair competitive wage disadvantage to the local economy. The negotiation of new contracts and the renewal of existing contracts with private sector entities shall be consummated in accordance with procedures established jointly by the Department of Commerce and the Division of Corrections. The procedures shall be drafted to ensure fairness and consistency in establishing contracts with private sector entities seeking to establish or continue prison based operations whenever the wage to be paid is less than the federally established minimum wage. The provisions of this section shall not be construed to apply to traditional prison industries as authorized in section three of this article and formerly authorized by article five-b, chapter twenty eight of this code.
§25-7-5. Purchase of inmate-made goods by state agencies and political subdivisions.

(a) On and after the effective date of this article as amended in the regular session of the Legislature in the year 2009, all offices, departments, institutions and agencies of this state which are supported, in whole or in part, by state funds shall purchase, and all government offices, departments, institutions, agencies and political subdivisions of any state may purchase, from the State Commissioner of Corrections all of the articles or products that they require from the Commissioner of the Division of Corrections if those articles or products are produced or manufactured by correctional industries, as provided by this article. No state office, department, institution, or agency, within the State of West Virginia may purchase any article or product that is produced by correctional industries from any other source, unless specifically excepted from the provisions of this section, as hereinafter provided by this article or otherwise by law.
(b) All purchases of correctional industries articles or products by state offices, departments, institutions, agencies and political subdivisions shall be made upon requisition by the proper authority of the office, department, institution, agency or political subdivision requiring such articles or products.
(c) Not-for-profit corporations or charitable agencies chartered in West Virginia or other states may purchase such goods and services. Units of the federal government and units of government in other states may also purchase such goods and services. All entities which contract with the state, its political units, its agencies, its public institutions, not-for-profit corporations or charitable agencies chartered in West Virginia may purchase goods or services from correctional industries which are used in the performance of the contracts.
§25-7-6. Exceptions as to mandatory purchase requirement.

Exceptions from the mandatory purchase provisions of section five of this article may be made in any case where, in the majority opinion of the Commissioner of Corrections, the Secretary of the Department of Administration and the Secretary of Military Affairs and Public Safety, or their designees, who are hereby constituted a board for purposes of this section, the article or articles or product or products produced or manufactured by correctional industries does or do not meet the reasonable requirements of the requesting state office, department, institution, agency or political subdivision or where the requisition cannot be filled because of insufficient supply or other reason. No state office, department, institution or agency, may evade the intent and meaning of this section by requesting unreasonable deadlines or slight variations from standards adopted by the Commissioner of Corrections, when the articles or products produced or manufactured by the commissioner, in accordance with the commissioner's standards, are reasonably adapted to the actual needs of the office, department, institution, or agency.
§25-7-7. Auditor bound by voucher or warrant; intentional violation of article; penalty.

No voucher, certificate, or warrant issued on the State Auditor by any state office, department, institution, or agency may be questioned by the Auditor or by the State Treasurer on the grounds that the office, department, institution or agency has failed to comply with the provisions of this article, but if a state office, department, institution, or agency continues to intentionally violate the provisions of this article, after notice from the Governor to desist, such action constitutes malfeasance in office and the person or persons responsible for the violation are subject to fine which will be deposited into the Correctional Industries Account. This fine will be equal to the cost of the purchase plus $100.
§25-7-8. Catalogues and a web site of articles and products made and produced.

The Commissioner of Corrections shall: (1) Cause to be prepared or updated, or both, at times he or she determines, catalogues and a web site containing a description of all articles and products manufactured or produced by the commissioner pursuant to the provisions of this article; (2) make copies and addresses available of this catalogue and web site address to all offices, departments, institutions and agencies of this state; and (3) make the same accessible to all political subdivisions of this state. Correctional Industries shall keep and maintain a web site that lists all of its products, services and pricing.
§25-7-9. Order of distribution of articles and products.

The articles or products manufactured or produced by correctional industries in accordance with the provisions of this article shall be devoted, first, to fulfilling the requirements of the offices, departments, institutions and agencies of this state which are supported, in whole or in part, by this state, and secondly, to supply the political subdivisions of this state.
§25-7-10. Director of correctional industries to determine prices.

The director of correctional industries shall determine the prices at which all articles or products manufactured or produced by correctional industries are furnished, which prices shall be uniform and nondiscriminating to all, and shall be as near the usual market price for those articles or products as is practicable.
§25-7-11. Annual statements by the director of correctional industries.

The director of correctional industries shall annually produce detailed financial reports in accordance with generally accepted accounting principles at the close of each fiscal year on the financial position of the correctional industry operation. The director of correctional industries shall verify the reports within sixty days after the end of the last preceding year.
§25-7-12. Commissioner of Corrections empowered to implement article.

The Commissioner of the Division of Corrections has those powers that are necessary to implement the provisions of this article to provide for the administration and procedure necessary for the implementation. To this end, the commissioner is authorized to cause to be purchased raw materials, supplies, services and equipment necessary for the production and timely delivery of articles and products produced by correctional industries. The commissioner shall develop policies and procedures to ensure that purchases made for the benefit of correctional industries programs are, to the extent practicable, at the lowest possible price while at the same time ensuring quality of material and timely delivery thereof.
§25-7-13. Self-liquidating contracts; indebtedness for capital
outlay projects.

In order to carry out the provisions of this article the Commissioner of the Division of Corrections is empowered to enter into contracts and agreements with any person or persons upon a self-liquidating basis respecting the acquisition and purchase of any such equipment, tools, supplies and materials, to the end that the same may be paid for over a period not exceeding five years.
§25-7-14. Correctional industries account.
(a) All moneys collected by the Commissioner of the Division of Corrections from the sale or disposition of articles and products manufactured or produced by inmate labor in accordance with the provisions of this article shall be immediately deposited with the State Treasurer to be kept and maintained in a special revolving account designated the "Correctional Industries Account".
(b) Except as provided in subsection (c) of this section, moneys collected and deposited may only be used for the purchase of manufacturing supplies, equipment, machinery and materials used to carry out the purposes of this article, as well as for the payment of the necessary personnel in charge thereof and to otherwise defray the necessary expenses incident thereto, all of which are under the direction and subject to the approval of the commissioner.
(c) Moneys in the account may also be used to pay wages due inmates for services provided under a contract between a state spending unit, political subdivision or other governmental entity and the Division of Corrections, pending receipt of the amounts owed for the services under the contract. The account shall be reimbursed within twenty-four hours of receipt of the amounts due under the contract from the state spending unit, political subdivision or other governmental entity.
(d) The "Correctional Industries Account" may never be maintained in excess of the amount necessary to efficiently and properly carry out the intentions of this article and in no event may the "Correctional Industries Account" be maintained in excess of the sum of $1,500,000. When, in the opinion of the Governor and the Secretary of the Department of Military Affairs and Public Safety, the "Correctional Industries Account" has reached a sum in excess of the requirements of this article, fifty percent of the excess shall be transferred by the Commissioner of the Division of Corrections at the end of each fiscal year, into the Corrections Academy Account established pursuant to subdivision (e) of this section. The commissioner shall transfer the remaining fifty percent of the excess into the Additional Operations Account established pursuant to subdivision (f) of this section.
(e) There is created in the State Treasury a special revenue account known as the "Corrections Academy Account." The commissioner is authorized to use funds from the account for the construction of a new correctional academy for the Division of Corrections.
(f) There is created in the State Treasury a special revenue account known as the "Additional Operations Account." The commissioner is authorized to use funds from the account to offset operational costs, for building maintenance or purchase and for equipment repair or replacement for the Division of Corrections, and to defray necessary expenses incident to those activities.
§25-7-15. Sale of prison-made goods on open market prohibited; penalty; exceptions.

(a) Subject to the provisions of subsections (b) and (c) of this section and to subsection (c) of section five of this article, it is unlawful to sell or offer for sale on the open market any articles or products manufactured or produced, wholly or in part, by inmates of this state, or any other state, except inmates or prisoners on parole or probation. This provision does not apply to articles or products manufactured and sold pursuant to the requirements of Title 18 U.S.C. 1761(c), the Prison Industry Enhancement (PIE) Certification Program and pursuant to sections eighteen and nineteen of this article, nor does it apply to the sale of products made with waste tires: Provided, That any use of waste tires shall comply with applicable laws and rules of the Division of Environmental Protection: Provided, however, That any products made by inmates from waste tires and sold on the open market must be competitively priced with privately produced goods of the same nature and may not be sold at a loss: Provided further, That any profits earned from the sale of products made by inmates from waste tires shall be distributed as follows: (1) To the correctional industries fund to reimburse all moneys expended in the collection of waste tires and the production of waste tire products, including a reasonable amount to be set aside for the periodic replacement of outdated, obsolete or inoperable machinery or equipment used in collection or production; and (2) any moneys remaining shall be divided equally between the Correctional Industries Fund and the Crime Victims Compensation Fund established by the provisions of section two, article two-a, chapter fourteen of this code.
(b) Any person violating the provisions of this section is guilty of a misdemeanor and, upon conviction, shall be punished by a fine of not less than $200 nor more than $5,000, or by imprisonment in jail not less than three months nor more than one year, or by both fine and imprisonment. Each sale or offer for sale shall constitute a separate offense under this section.
(c) Notwithstanding the provisions of subsection (a) of this section, any articles or products manufactured or produced, wholly or in part, by inmates of West Virginia correctional facilities which are designed and intended to be used solely by blind and handicapped persons, including, but not limited to, braille books and reading materials, may be sold or offered for sale or distributed on the open market by the Division of Corrections or other state department or agency.
(d) Notwithstanding the provisions of subsection (a) of this section, arts and crafts produced by inmates may be sold to the general public by the Division of Corrections or by other agencies or departments of state government the Commissioner of Corrections may designate. The arts and crafts may be sold only on a consignment basis so that inmates whose arts and crafts products are sold shall receive payment for the products. The payments shall be deposited in the accounts or funds and managed in a manner as provided by section six, article five of this chapter: Provided, That where the Division of Corrections or any other agency or department of state government provides any materials used in the production of an arts and crafts product, the fair market value of the materials may be deducted from the account of the individual inmate after the sale of the product.
(e) For purposes of this section, "arts and crafts" means articles produced individually by artistic or craft skill such as, but not limited to, painting, sculpture, pottery and jewelry.
(f) Notwithstanding the provisions of subsection (a) of this section, paper for use in copiers, fax machines, for printing or duplication purposes and boxes for shipping and storage may be procured to the extent practicable at the lowest possible price while at the same time insuring quality material and timely delivery thereof, for resale to offices, departments, institutions or agencies supported, in whole or in part, by this state and political subdivisions thereof.
§25-7-16. Provisions of act severable.
If any section, subsection, provision or sentence of this act or the application thereof to any person, or any circumstance, is held invalid, the remainder of the act and the application of any such section, subsection, provision or sentence to other persons or circumstances is not affected thereby.
§25-7-17. Inconsistent acts repealed.

All acts and parts of acts inconsistent with this article are hereby repealed; however, this article is to be considered as supplementary, or in addition to other provisions of law now existing relative to the employment of inmates.
§25-7-18. Programs for employment of offenders by private persons; establishment; lease of land and improvements.

(a) The Commissioner of Corrections or the Director of Juvenile Services, or both may establish programs for the employment of offenders by private person, corporation, partnership, limited liability corporation or other business entity for the manufacture of certain goods as part of a program authorized pursuant to Title 18 U.S.C. 1761(c), the Prison Industry Enhancement (PIE) Certification Program. In establishing these programs, the Commissioner of Corrections or the Director of Juvenile Services or both may enter into agreements with any private person, corporation, partnership, limited liability corporation or other business entity under which that entity establishes, by construction, lease or otherwise, facilities within the exterior boundary of any state adult correctional facility or at such suitable location as may be agreed upon, for the manufacture and processing of goods or any other business, commercial or agricultural enterprise.
(b) In administering this chapter, the Commissioner of Corrections or the Director of Juvenile Services or both may, as part of or in connection with any agreement made under subsection (a), lease, for not more than twenty years, with options of renewal, land, with the improvements on it, located on the grounds of any state correctional facility for use by the private party to that agreement for providing inmate work under this chapter.
§25-7-19. Agreement between commissioner and private person for manufacturing pursuant to Prison Industries Enhancement Program; wages; inmate participation on voluntary basis; workers compensation and unemployment compensation.

(a) Any agreement entered into between the Commissioner of Corrections or the Director of Juvenile Services or both the commissioner and the director and a private person, corporation, partnership, limited liability corporation or other business entity to establish a program for inmates to manufacture goods pursuant to a prison industries enhancement program shall provide the following:
(1) That an offender participating be paid at least the prevailing wage for the type of work as established by the Department of Workforce Development, including applicable wage increases for overtime work.
(2) That an offender's work or participation within a prison industries enhancement program shall be only on a voluntary basis and only after the offender has been informed of the conditions of the offender's participation.
(3) That an offender participating in a prison industries enhancement program shall be permitted at the discretion of the Commissioner of Corrections or the Director of Juvenile Services or both, the commissioner's designee or the director's designee, or both and any inmate may be removed from or disallowed participation in such program at any time for any or no reason.
(4) That the agreement will not result in the displacement of workers employed before the program implementation.
(5) That the private person, corporation, partnership, limited liability corporation or other business entity provide for worker's compensation insurance or the equivalent coverage to all offenders participating in such program.
(6) That the provisions of this section shall not be applicable to service agreements provided in section four of this article or to operations making goods authorized by section three of this article that are restricted from sale in the open market. (b) A commercial or agricultural enterprise established under this chapter is a private enterprise subject to federal and state laws governing the operation of similar enterprises.
(c) The earnings of an offender participating in a prison industries enhancement manufacturing program under this chapter shall be surrendered to the Division of Corrections or the Division of Juvenile Services, or both, respectively. This amount shall be distributed in the following order:
(1) In the case of offenders in the custody of the Commissioner of the Division of Corrections, said earnings shall be paid to the offender. All state, federal and local taxes shall be withheld together with all other deductions required and authorized by this chapter including expenses for room and board. Provided that in addition thereto, the Commissioner of the Division of Corrections shall, pursuant to his or her policy making authority, issue rules to provide for the deduction of inmate wages in an amount no less that five percent and no greater than twenty percent to be paid to the violent crime victims compensation fund established by section one, article two-a, chapter fourteen of this code. Total deductions of inmate earnings shall not exceed eighty percent of the inmate's gross wages.
(2) In the case of a juvenile committed to the custody of the Director of the Division of Juvenile Services the following shall apply:
(A) Not less than twenty percent of the offender's gross earnings to be given to the offender or retained by the Director of the Division of Juvenile Services. If retained by the director, the amount, with accrued interest, if interest on the amount is earned, shall be returned to the offender not later than at the time of the offender's release on parole or discharge.
(B) State and federal income taxes and Social Security deductions.
(C) The expenses of room and board, as fixed by the director and the budget agency, in facilities operated by the director, or, if the offender is housed in a facility not operated by the director, the amount paid by the Division of Juvenile Services to the operator of the facility or other appropriate authority for room and board and other incidentals as established by agreement between the Division of Juvenile Services and the appropriate authority.
(D) The support of the offender's dependents, when directed by the offender or ordered by the court to pay this support. If the offender's dependents are receiving welfare assistance, the appropriate local office of the division of family resources or welfare department in another state shall be notified of these disbursements.
(E) Ten percent of the offender's gross earnings, to be deposited in the violent Crime Victims Compensation Fund established by section one, article two-a, chapter fourteen of this code.
(F) Any remaining amount shall be given to the offender or retained by the director in accord with subsection (3)(b)(i).
(G) The director may, when special circumstances warrant or for just cause, waive the collection of room and board charges by or on behalf of a facility operated by the Division of Juvenile Services or, if the offender is housed in a facility not operated by the Division of Juvenile Services, authorize payment of room and board charges from other available funds.



NOTE: The purpose of this bill is to enact the "Correctional Industries Act of 2009" by modernizing the provisions of the Prison-made Goods Act of 1939. The bill also authorizes the creation of the Prison Industries Enhancement Programs provided by Title 18 U.S.C. 1761(c).

This article is new; therefore, strike-throughs and underscoring have been omitted.

This bill was recommended for introduction and passage during the 2009 Regular Session of the Legislature by the Legislative Oversight Committee on Regional Jail and Correctional Facility Authority.
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